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Harvard and most Ivy League schools are not interested in maximizing academic potentials of the their students. They want to maximize influence and future donations. I think they are quite satisfied with their results in that way.

Also standardized testings like SAT have become easier. Less of a correlation with IQ, for example. Grade inflation is rampant. The education system is designed to make good students less likely to stand out.

The schools who care about their students' smart behave very differently. Just look at Caltech and to some extent MIT. I am very disappointed by U of Chicago's direction. I didn't expect them to be the leader in the test optional movement.